Hosted PBX: Market Research Report

Hosted VoIP

Hosted PBX: Market Research Report

By TMCnet Special Guest
Micah Singer, CEO with VoIP Logic
  |  November 06, 2014

To better understand the hosted/cloud PBX and unified communications market, VoIP Logic (News - Alert) conducts an annual market research survey focused on VoIP service providers and related organizations like telephony hardware/software manufacturers, resellers/agents of hosted PBX (News - Alert), consultants, and companies considering launching VoIP services like IT services, ISPs, data centers, ILECs, MVNOs, etc. It is hard work to get enough opinions from enough thoughtful professionals on enough issues to draw some conclusions, but with a free give-away of our previous report in exchange for a completed survey we have consistently managed to collect compelling information.

The complete VoIP Market Research Report for 2014 is available on our website at with the completion of the latest survey. With the publication of the 2014 report, you can also download the 2013 VoIP Market Research Report without completing a survey from the same location.

There were many interesting findings. Two of the data points I want to discuss and share,  presented in the graphs below, are the relative importance of different sales criteria and different operational criteria to VoIP service providers. 

In the survey, we collected input from 116 different VoIP service providers that are demographically skewed smaller – 54 percent with revenues of $10 million or less and 23 percent with revenues between $10 million and $100 million – similar overall to VoIP Logic’s target market. We found that the single best predictor of sales success (Figure 1) is an existing relationship – not surprising.

Pricing, bundling, and customer service are all a close second, we hear this a lot as we work with VoIP service providers. Enterprise customers do not want to be treated like a number and fit into a fixed sales package, they want their vendor to know them (existing relationship), create a package that fits their specific business needs (bundling and price), and then support them with a live recognizable human voice (customer support). Some respondents did underscore the value of online tools such as a knowledge base, detailed FAQs, and IM-based support as complements to a human voice. 

Figure 1: Selling Hosted PBX Services

Figure 2: Operating Hosted PBX Services

When it comes to operating VoIP technology, service providers are decidedly less consistent.  Expected uptime was the most important issue. In working with more than 30 service provider partners at VoIP Logic, I can vouch that this is indeed the most relevant issue by far. However, price comes in as the second most important issue when selecting technology – almost antithetical to expected uptime under the you-get-what-you-pay-for mantra that is generally understood both in pricing strategies and in purchasing strategies. 

The trend continues – the third most important operational attribute is well-regarded technology, which is generally slang for more expensive. The least important items of the selectable options are both strongly correlated to service provider size and expected results in that they are only important if you grow large and successful (scalability and upgradeability).

Notably low on the list are cutting edge features. There is always considerable talk about the neatest applications and integrations for your voice technology but, ultimately, the basics of good service, low prices, and sound technology are what keep VoIP service providers growing today.

It is important to listen anecdotally to your service provider and enterprise customers, but it is also important to watch these kind of larger trends in the market. Collecting and sharing this data hopefully makes us all better at what we do.

Edited by Maurice Nagle